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<h1>Carry forward of capital losses limited in duration; set off restricted by asset type, with distinct rules for long and short term losses.</h1> Clause 111 requires that an unabsorbed capital loss be carried forward to the subsequent tax year and set off according to asset type: long term capital losses may be set off only against long term capital gains, while short term capital losses may be set off against capital gains from any capital asset; carry forward is permitted only for a limited number of succeeding tax years, and 'unabsorbed capital loss' is defined as loss under Capital gains not wholly set off for that year.